Santa Barbara Real Estate Mid Year Economic Forecast

Santa Barbara Real Estate Mid Year Economic Forecast. I attended the Santa Barbara Mid Year Economic Forecast presented by Economist, Dr. Mark Schniepp. Here are the highlights of the presentation:

Within the next 12 months, expect higher home prices and rising demand which will increase the currently very low inventory.

Within the next 12 months, expect price appreciation in the 7% to 10% range.

Within the next 12 months, expect credit markets to gradually loosen in terms of qualification, but expect higher interest rates. Jumbo financing is becoming more desirable than conforming financing because Fannie Mae & Freddie Mac are no longer being subsidized by the government.

Within the next 12 months, expect a better economy, greater employment opportunities, greater wealth and housing to strengthen. Economist Shniepp states “If it doesn’t rebound as quickly as expected, this will only intensify the level of demand when it does break out…and there will be greater home price appreciation than expected.”

v The median sales price for the South Coast which includes Santa Barbara, Montecito, Hope Ranch, Carpinteria/Summerland & Goleta is up 26.4% over this time in 2013. The Santa Barbara median sales price currently stand at $1,125,000. The number of Santa Barbara single family home sales for the South County is down 25.8%.

v The number of sales is down primarily because inventory is very low. The slide presented shows inventory as of May 2014 at 310 homes for sale on the South Coast. The greatest amount of inventory available for sale is above $2 million. Today there are 334 homes for sale on the South Coast. This is a very low inventory considering the South Coast population is approximately 200,000 people.

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